America can’t spend its way to prosperity

August 30, 2011

Freedom New Mexico

Our latest experiment with Keynesian liberalism — led by the last two presidents — has predictably failed and the economy is in shambles. President Barack Obama will need a miracle to win re-election in 2012, no matter who runs against him and no matter how unpolished or gaffe-prone that candidate may be.

Obama will announce his latest plan to fix the economy next week, and it is certain to involve more federal spending. We cannot possibly spend our way to prosperity, a fact Americans have figured out.

Want change? Toronto banker and writer David Lee says look to the north. Canada thrives as a result of dramatic reductions in government spending enacted by the right and two brave politicians on the left. At a time when the rest of the developed world struggles with unmanageable debt, high unemployment, riots in the streets and other forms of civil unrest that are tied directly to economic despair, Canada mesmerizes financial experts with falling unemployment, a government surplus and other inspiring indicators.

“The approach to government largesse that differentiated Canadian policy from that in the rest of the world is now paying dividends as the financial media swoons over Canada’s current fiscal situation,” wrote Lee, in an article published Monday by the Ludwig von Mises Institute. “If there is a lesson to be gleaned from this experience, it is that, whatever the supposed short-term benefits may be, the long-run economic implosion necessitated by rampant government spending can only be delayed, never averted.”